LITHIA MOTORS INC (LAD)
US5367971034 - Common Stock
We assign a fundamental rating of 5 out of 10 to LAD. LAD was compared to 125 industry peers in the Specialty Retail industry. There are concerns on the financial health of LAD while its profitability can be described as average. LAD is growing strongly while it is still valued neutral. This is a good combination!
1. Profitability
1.1 Basic Checks
LAD had positive earnings in the past year.
LAD had a negative operating cash flow in the past year.
Each year in the past 5 years LAD has been profitable.
The reported operating cash flow has been mixed in the past 5 years: LAD reported negative operating cash flow in multiple years.
1.2 Ratios
LAD's Return On Assets of 5.10% is fine compared to the rest of the industry. LAD outperforms 67.20% of its industry peers.
With a decent Return On Equity value of 16.11%, LAD is doing good in the industry, outperforming 71.20% of the companies in the same industry.
The Return On Invested Capital of LAD (6.97%) is comparable to the rest of the industry.
LAD had an Average Return On Invested Capital over the past 3 years of 9.77%. This is below the industry average of 14.70%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.1% | ||
| ROE | 16.11% | ||
| ROIC | 6.97% |
ROA(3y)7.65%
ROA(5y)6.67%
ROE(3y)21.02%
ROE(5y)19.85%
ROIC(3y)9.77%
ROIC(5y)8.56%
1.3 Margins
The Profit Margin of LAD (3.22%) is better than 64.80% of its industry peers.
In the last couple of years the Profit Margin of LAD has grown nicely.
LAD's Operating Margin of 5.59% is fine compared to the rest of the industry. LAD outperforms 65.60% of its industry peers.
In the last couple of years the Operating Margin of LAD has grown nicely.
Looking at the Gross Margin, with a value of 16.70%, LAD is doing worse than 85.60% of the companies in the same industry.
In the last couple of years the Gross Margin of LAD has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.59% | ||
| PM (TTM) | 3.22% | ||
| GM | 16.7% |
OM growth 3Y1.36%
OM growth 5Y8.37%
PM growth 3Y-3.44%
PM growth 5Y7.46%
GM growth 3Y-0.52%
GM growth 5Y2.12%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), LAD is creating some value.
The number of shares outstanding for LAD has been increased compared to 1 year ago.
The number of shares outstanding for LAD has been increased compared to 5 years ago.
The debt/assets ratio for LAD is higher compared to a year ago.
2.2 Solvency
LAD has an Altman-Z score of 2.68. This is not the best score and indicates that LAD is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of LAD (2.68) is better than 65.60% of its industry peers.
LAD has a Debt/Equity ratio of 1.74. This is a high value indicating a heavy dependency on external financing.
LAD has a Debt to Equity ratio of 1.74. This is in the lower half of the industry: LAD underperforms 66.40% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.74 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.68 |
ROIC/WACC0.86
WACC8.07%
2.3 Liquidity
A Current Ratio of 1.41 indicates that LAD should not have too much problems paying its short term obligations.
LAD has a Current ratio of 1.41. This is comparable to the rest of the industry: LAD outperforms 46.40% of its industry peers.
A Quick Ratio of 0.45 indicates that LAD may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.45, LAD is doing worse than 61.60% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.41 | ||
| Quick Ratio | 0.45 |
3. Growth
3.1 Past
The earnings per share for LAD have decreased strongly by -16.78% in the last year.
Measured over the past years, LAD shows a very strong growth in Earnings Per Share. The EPS has been growing by 29.82% on average per year.
Looking at the last year, LAD shows a quite strong growth in Revenue. The Revenue has grown by 10.11% in the last year.
Measured over the past years, LAD shows a very strong growth in Revenue. The Revenue has been growing by 21.30% on average per year.
EPS 1Y (TTM)-16.78%
EPS 3Y26.78%
EPS 5Y29.82%
EPS growth Q2Q-8.95%
Revenue 1Y (TTM)10.11%
Revenue growth 3Y33.24%
Revenue growth 5Y21.3%
Revenue growth Q2Q10.48%
3.2 Future
LAD is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.38% yearly.
The Revenue is expected to grow by 16.39% on average over the next years. This is quite good.
EPS Next Y-3.13%
EPS Next 2Y4.24%
EPS Next 3Y8.86%
EPS Next 5Y12.38%
Revenue Next Year16.33%
Revenue Next 2Y13.38%
Revenue Next 3Y13.61%
Revenue Next 5Y16.39%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 7.07 indicates a rather cheap valuation of LAD.
Based on the Price/Earnings ratio, LAD is valued cheaper than 95.20% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 24.80, LAD is valued rather cheaply.
LAD is valuated cheaply with a Price/Forward Earnings ratio of 7.30.
93.60% of the companies in the same industry are more expensive than LAD, based on the Price/Forward Earnings ratio.
LAD's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 21.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.07 | ||
| Fwd PE | 7.3 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LAD indicates a somewhat cheap valuation: LAD is cheaper than 70.40% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 7.02 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)0.24
EPS Next 2Y4.24%
EPS Next 3Y8.86%
5. Dividend
5.1 Amount
With a yearly dividend of 0.75%, LAD is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.38, LAD pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.40, LAD's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
5.2 History
On average, the dividend of LAD grows each year by 10.96%, which is quite nice.
LAD has paid a dividend for at least 10 years, which is a reliable track record.
LAD has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.96%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
LAD pays out 5.28% of its income as dividend. This is a sustainable payout ratio.
LAD's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP5.28%
EPS Next 2Y4.24%
EPS Next 3Y8.86%
LITHIA MOTORS INC
NYSE:LAD (4/18/2024, 7:04:43 PM)
After market: 260.35 0 (0%)260.35
-0.59 (-0.23%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap7.17B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.07 | ||
| Fwd PE | 7.3 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)0.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.1% | ||
| ROE | 16.11% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 5.59% | ||
| PM (TTM) | 3.22% | ||
| GM | 16.7% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.58
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.74 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.41 | ||
| Quick Ratio | 0.45 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-16.78%
EPS 3Y26.78%
EPS 5Y
EPS growth Q2Q
EPS Next Y-3.13%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)10.11%
Revenue growth 3Y33.24%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y